EyesOnThePrize's Overpayment Diary

EyesOnThePrize

Hi everyone

Very long time lurker - I'm 30 now but I've been visiting MSE on and off since I was a teenager .

By way of brief overview:

• Bought a two bed flat in London in 2016 with a mortgage of £211,500, 18 years 3 months remaining
• Remortgaged 2018 on a five year deal to April 2023 at 2.29%
• Mortgage currently at £121,000
• Also have a rainy day fund of £10,000

My DW and I have a baby (rapidly approaching his 1st birthday :eek:) so our plans will either be to (i) stay here long term if we don't have another kid or (ii) sell up at the end of the fixed term and get somewhere bigger. If we stay put I'd like to have paid off the mortgage by my late 30s.

I've managed to make the maximum 10% overpayment or near enough each year so far and want to continue if I can, though my DW will be going back to work part time in April and baby boy will get pricier as he gets older I'm sure! I'm a professional and luckily on a good salary so I'm trying to essentially live on half of what I earn, including saving approx £18,000 a year for mortgage overpayments. I overpay what I'm allowed to which incurring an early repayment charge, then plan to save up the rest and stick it on the mortgage at the end of the fixed term before finding another fixed term in May 2023 (I assume that's possible anyway!).

I grew up poor so I'm always planning for worst case scenarios (losing jobs etc) and squirreling away money. I've set myself a side goal of saving an additional £1000 this year on top of the £18,000 but not at the expense of having fun with DW and baby boy.

I'll try and update each month or season or so on my progress! It's good to keep note to keep my motivation up!

South_coast

Morning Eyes, love the username!

Amazing progress so far, and I like the idea of trying to live on half your earnings (is that net or gross?) Off to try and work out what percentage of mine I "allow" myself to live on now!

EyesOnThePrize

South_coast wrote: »

Morning Eyes, love the username!

Amazing progress so far, and I like the idea of trying to live on half your earnings (is that net or gross?) Off to try and work out what percentage of mine I "allow" myself to live on now!

Hi South, thanks for stopping by and for the kind words! Hope you're doing well.

Unfortunately maths is not my strong suit so my answer is a bit convoluted. Essentially I get paid four weekly so I have a thirteenth "magic pay cheque" each year. I live as though I earn half of my net pay, but treat the magic pay cheque as mad money (though that also tends to get saved if it's not going towards holidays or insurance renewal etc). I aim to save £1500 out of each of the other twelve pay cheques for OP and another £250 for baby boy's junior ISA.

I'm very lucky in that my salary has increased dramatically over the last few years but my mindset is still that I earn around the national average. I don't really miss the extra because I've never become accustomed to spending it.

newgirly

Wow that’s amazing you have done so well already and so young!

EyesOnThePrize

newgirly wrote: »

Wow that’s amazing you have done so well already and so young!

Thanks newgirly! When I first started working I went a bit mad spending on designer goods but soon realised they didn't make me any happier. I think that helped me get all the splurging out of my system early on and I've been (mostly) well behaved since .

EyesOnThePrize

"End" of the weekend so here's an update on this week's savings:

• £10 leftover from work lunch budget of £20
• £5 leftover from weekend budget of £70

I work much closer to home and to a supermarket so I'm definitely getting better at bringing in homemade lunches or ready meals nowadays.

As mentioned before, additional savings are earmarked for overpayments but realistically we have a lot of expenses coming up that they might be needed for instead, including:

• Long weekend in Dover - accommodation and transport booked so just meals.
• Five days in CenterParcs - need to book taxi (we don't have a car because both DW and I get free public transport in London) and money for meals. Entertainment and bikes paid for.
• Summer holiday in Copenhagen - flights paid for but taxis, food and hotel need paying for. Some of my "magic pay cheque" earmarked for this.
• Maxing out DS's ISA - I make regular payments into this, as do my parents, so it'll only be a few hundred shy of the yearly maximum by April. "Magic pay cheque" earmarked for this.

Running totals for 2020:

• 2020 10% overpayment: £12,000 of £13,600 made
• 2021 10% overpayment: £0 of approx £12,000 saved
• £64.50 "extra" savings
• £10,000 rainy day
• £10,000 potential IVF savings

EyesOnThePrize

Quick daily update:

Cheap day, bought a couple of ready meals for lunches this week and next and had my first ever Big Mac thanks to the offer on the Maccy Ds app. Not bad!

Also bought some batteries for baby boy's book because it's stopped squawking... but it must just be broken because replacing them did nothing how to break the bad news to a 9 month old...

Finally, bought some tablets from Boots and used my 200 extra points offer. Scanned my receipts for my first day of Receipt Hogging and Shoppixing. I miss the glory days of Job Spotting, way more lucrative!

I've transferred the rest of my lunch money for the week to savings as I've got leftovers and salads for the rest of the week now. Savings now at £79.50.

Must remember my reusable carrier bag tomorrow, just in case!

EyesOnThePrize

Daily update:

Thought today would be a fairly boring entry (NSD) but was told I'm getting a promotion this afternoon! :j Based on my (terrible) maths I think I'll be getting around two hundred more every four weeks so think that will go:

• £100 more on overpayments
• £50 more on baby boy's ISA
• £50 mad money

Not a bad Tuesday!!

savingholmes

Congratulations on being so disciplined with money and the promotion. That's a hefty chunk you've repaid on your mortgage. Don't forget to invest in pensions too.

Bennettxoxo

Congrats on the promotion :T

Looking forward to keeping up with your diary and saving!

EyesOnThePrize

savingholmes wrote: »

Congratulations on being so disciplined with money and the promotion. That's a hefty chunk you've repaid on your mortgage. Don't forget to invest in pensions too.

Thanks savingholmes for the kind words! You raise a good point about pensions, I confess I'm a bit hazy about them. DW and I both have DB pensions at our current jobs so I assume that's a good start but I'm not sure what more I can be doing. Definitely worth some investigation!